Attorney General Josh Stein to Federal Utility Regulator: Give Tax Savings to Customers, Not Utilities
RALEIGH, NC (January 10, 2018)…Following the reduction of the federal corporate tax rate, Attorney General Josh Stein today called on the Federal Energy Regulatory Commission (FERC) to take immediate steps to ensure that public utility companies do not receive a major windfall at the expense of their customers.
In a letter sent to FERC, Attorney General Stein requests that an investigation be opened into whether the current rates for federally regulated utilities – including electric, natural gas and oil companies – are justified following the recent passage of the new federal tax law that reduces the corporate tax rate from 35 to 21 percent.
“Given this winter’s temperatures, North Carolinians are already giving over more of their hard-earned money to utilities in higher bills,” said Attorney General Stein. “The benefits of the recent federal corporate tax cut should go to consumers, not the utilities. That’s why I’m asking federal regulators to lower utilities’ rates right now.”
Specifically, Attorney General Stein is concerned about the impact the new federal tax law has on the level of corporate income tax expenses that are incorporated into a public utilities’ rates and the amount of money that utilities are holding in reserve to pay future tax bills. The letter requests that FERC act as quickly as possible to make any necessary changes to utilities’ rates to ensure that customers’ bills are reduced and to set an immediate date to refund utility customers for any over-collection resulting from delays.
As the coalition notes in the letter, FERC has experience in adjusting customers’ rates to reflect a reduction in federal income taxes. In 1987, FERC allowed electric utilities to file for rate decreases after President Ronald Reagan lowered the corporate tax rate from 46 to 34 percent.
Joining Attorney General Stein in sending today’s letter are the attorneys general of California, Connecticut, Illinois, Kentucky, Maryland, Massachusetts, Nevada, New York, Rhode Island, Texas, Virginia, as well as the Connecticut Office of Consumer Counsel, the Florida Office of Public Counsel, the Maine Office of the Public Advocate, the New Hampshire Office of the Consumer Advocate, the Rhode Island Division of Public Utilities and Carriers, and the Vermont Department of Public Service.